A PwC perspective on gov’t v. pharmacists in Ireland

August 17, 2009 – 10:24 am by Joshua Slatko

After a lengthy staredown, the Irish Pharmacy Union has backed off and recommended that its members return to servicing the government’s drug schemes. To give a more local perspective on the conflict between the government and the pharmacists in Ireland, I spoke with Paul Monahan of PriceWaterhouseCoopers’ Dublin office.

Med Ad News: Reading the press releases from HSE and the IPU, an outsider gets the sense that they were living in two different countries, with one claiming that the situation was busy but manageable and the other asserting that a medical catastrophe was in progress. What was the reality of the situation on the ground? Did the conflict affecting the entire country, or were its effects geographically limited to a few areas? How did ordinary people respond? Was there greater sympathy on the street for one side or the other?

Paul Monahan: The reality was that in general it was busy but manageable – there were some reported instances of excessive delays but these did seem quite localized. The dispute did affect the whole country but effects were more severe in less populated rural areas where there are fewer pharmacies, and also in areas with a heavier lower socioeconomic grouping of population, where there was heavier reliance on medical cards (given to people on lower incomes with medical conditions that entitle people to free primary care and medicines). In general I would say there was limited support for the pharmacists, somewhat surprising perhaps as the HSE is unpopular among the general population, but I do not think there was huge support for one side or the other and this was probably a factor in the IPU calling off the protest on August 12.

Med Ad News: For a non-Irish audience, can you give some background on the history that is informing this conflict? What motivated the cuts in payments announced by the Minister for Health in mid-June? Have there been other conflicts between HSE and the IPU?

Paul Monahan: Ireland has been hit harder than most by the credit crunch – property related taxes made up an unsustainable portion of Irish tax revenue and when the property bubble burst here so did tax revenue, making cuts in government expenditure inevitable. Under EU rules our budget defict should not exceed 3% of GDP but it could be 14% in the current year. Taxes have been raised. Health has been targeted early in the process and obviously drug spending is a big part of health spending. Public sector health employees (the majority) have borne an 8% pay cut through a pension levy and the cuts in pharmacist income (pharmacists are independent contractors, not employees in general) should be seen in that light. There have been other disputes between HSE and IPU mostly in relation to the liberalization of the pharmacy sector but nothing as severe as this before.

Med Ad News: It appears that the IPU has stepped back and is recommending that pharmacists continue services. Why do you think they made this decision? Have we seen the end of this conflict, or is there more to come? How do you foresee the situation playing out over the next weeks and months?

Paul Monahan: It seems clear the IPU have backed down and this was for a couple of reasons – firstly probably limited public support and secondly, the HSE also in my view played hardball and opened the “contingency dispensing facilities.” I would like to think there was a bit of altruism on the part of pharmacists as well and they realized that patients would suffer, but ultimately I believe that the IPU realized “he who pays the piper call the tune” and that there is public recognition that spending has to be cut. This dispute is over; there will be discussions going forward on alternative savings, etc., but in essence the HSE have forced through their cuts. There will also be pressure on HSE to get similar savings from the drug companies, I believe.

Med Ad News: Talk a little bit about the political dimensions of the conflict. Representatives of the Fine Gael have criticized Minister Harney for her no-negotiation position. Will this be a potential election issue?

Paul Monahan: Health will definitely be an election issue – the main opposition health spokesman is a GP and is a very vocal critic but the election will be fought more around the ER issues in hospitals, the centralization of oncology, the status of local hospitals, and probably reform of the medical card system, which I suspect is coming, rather than this pharmacists dispute. This dispute will be important for the minority who were seriously inconvenienced but I do not see it as a major election issue – there are too many candidates for that (even in health) – it is more a question of take a number for your own pet gripe and stand in line.